RMB now one of the top ten most-used currencies for payments

A symbolic milestone has been achieved by the Chinese currency, as in both November and December 2013 it was one of the top ten most-used currencies for payments in terms of value. Over the past three years, the RMB overtook 22 currencies, most recently the Singapore dollar and the Hong Kong dollar, and is now trailing the Swiss franc 1.12% to 1.29%.

"A question is whether the RMB will continue its climb – or at least maintain its status as a “top ten” currency for payments. We might expect it to fall back during Q1 2014 as a result of the Chinese New Year, as we have seen previously" says Franck de Praetere, head of payments and trade markets, Asia Pacific, at SWIFT. "The fact that between November and December 2013 other currencies grew 7% whilst the RMB grew 15%, however, might suggest that use of the Chinese currency is becoming business as usual for the world's financial institutions and corporates."

Adds Mr. de Praetere: "Now that the RMB has consolidated its position as a globally-used currency, we expect the industry's attention to shift to discussions on the best architecture for RMB cross-border transactions so the market can reach levels of operational efficiency, risk and liquidity management on par with other globally-traded currencies."

RMB payments remain concentrated in Hong Kong, which has a 74% market share in terms of value, with strong growth seen in the United Kingdom, Singapore and Taiwan.